Engineering colleges in Tamil Nadu are anxious as companies skip campus recruitment

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India’s top IT companies — bulk recruiters in engineering colleges — are likely to skip campus placements this year, which is worrying news for Tamil Nadu’s engineering colleges, especially tier-2 and tier-3 categories that send a large number of graduates to the sector. The bulk recruiters are facing a weak demand environment and an excess freshers’ bench.

The State’s 500+ engineering colleges churn out thousands of graduates every year, with a sizeable number going to the IT sector.

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TCS is recalibrating its gross hiring, while Infosys said it may not go to campus this year as it has a large freshers’ strength. Interestingly, HCL Technology said it would continue to recruit freshers this year.

Milind Lakkad, Chief HR Officer, TCS, told analysts that the company has been investing in fresh talent for almost 18 months, and that investment is now paying off. Also, because of lower attrition, the company has recalibrated its gross hiring, and those numbers are less than our attrition.”

Officials at various engineering colleges are worried about the trend of lower hiring by the top IT companies and reluctant to comment.

IT services companies not hiring will impact Tier-2 and Tier-3 colleges largely. But for larger educational institutions, such as Anna University, there may not be much impact. A number of core companies have shown interest in hiring on campus for both IT and non-IT requirements, said Shanmuga Sundaram, Director, Centre for University Industry Collaboration, Anna University.

The placement at the university started in August and will go on until mid-November. Out of 1,500+ eligible students, already 460+ students have been placed in nearly 70 companies, with another 70 companies yet to complete their hiring, he said.

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‘Short-term phenomenon’

With continued weakness in discretionary spending, large cost take-out deals coming in with built-in productivity commitments, attrition coming down sharply, employee utilisation going up by 3-5 per cent in about a year, and automation driving higher levels of productivity, net new hiring in the IT sector is bound to be anaemic until there are some green shoots, said Ramkumar Ramamoorthy, Partner, Catalincs and former CMD, Cognizant, India.

“I believe this pullback in campus hiring among large IT companies is only a short-term phenomenon,” he added.

Jayaprakash Gandhi, an education consultant, said the trend is really worrisome. Top colleges, which have huge numbers of computer science and IT-related students, are definitely in challenging positions.

Just coding skills are not enough. Companies expect students to use AI tools to deliver in quicker mode. Many institutions took it easier in the current scenario in the IT field, he said.

MS Prasadh, Workforce Research, Xpheno Private Ltd., a specialist staffing firm, said IT companies have broken the critical talent build process by staying away from campus for literally two cycles. The last time the build process was broken was in the years preceding the pandemic.

IT companies did not go to campus in 2018 and 2019, and the impact was felt in buoyant 2021. With no internal supply of trained talent, lateral buying of talent was forced and done at unimaginably high costs. The long shadow of high-cost hyper-hiring has been lingering around. Breaking the build now, amidst margin pressures, will come back to haunt the sector again during a recovery curve.

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